CNBC reported that people may use cash because they don't have a checking account. Others prefer the privacy of using cash as opposed to credit cards or electronic billing. For some families, cash is cheaper than credit and can help control their spending.

But a new study from Tufts University shows that using cash actually costs consumers and businesses $200 billion annually. The cost of cash for the average family is about $1,739, CNBC reported.

Fees for using cash can come from using a check-cashing service, withdrawing cash from non-network ATMs or accessing wages on a payroll card.

The study found that poorer Americans or those without banks are hit disproportionately hard by using cash. Someone without a bank account pays an average of $3.66 more per month than someone with an account.

The time spent getting cash also factored into the study. Researchers said the average American spends 28 minutes per month going to the bank or an ATM to get cash.

One of the big cost factors was how people were paid, the study found. Those paid by a payroll card had average costs four times others surveyed. Those who were paid by direct deposit or in cash had the lowest fees.